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Sunday, August 21, 2016

SPX S&P 500 Support, Resistance (S/R), Moving Averages and Other Important Levels for Trading the Week of 8/22/16

SPX (S&P 500) support,
resistance (S/R), moving averages and other important levels are provided for
the trading week of 8/22/16.Levels shown in bold are strong resistance
and support. Bold and underlined levels are very strong and important S/R.

For the S&P 500
in history, the all-time record high prints last Monday, 8/15/16, at 2193.81. The
all-time closing high is 2190.15 on 8/15/16.
The SPX has taken out the May 2015 highs after this stock market top held
in place for 15 months. The bulls, that continue to remain complacent due to
non-stop central banker money-printing, are correct in their cheer leading the
stock market higher since new record highs keep printing.The all-time record
intraday low is 666.79 (the infamous 666) on 3/6/09 and all-time closing low is
676.53 on 3/9/09.

For 2016, the intraday
high for this year is the 2193.81. The closing high for this year is at 2190.15.
Theintraday low for this year is
1810.10 on 2/11/16 and the closing low thus far this year is 1829.08 on
2/11/16. The intraday low in 2015 was 1867.01
on 8/24/15 and intrayear closing low for 2015 was 1867.61 on 8/25/15. Obviously, a failure under the 1810-1868 zone
would lead to a catastrophic path ahead for stocks but this concern is not even
on the map as equities print new all-time record highs near SPX 2200.

Keystone’s 80/20 rule says 8’s lead to 2’s so the close
above 2180 at 2190 hints that 2220-plus is on the table. The SPX begins August
at 2174. The SPX is up 130 points, +6.4%, above the starting year number at 2044.
The central bankers saved the markets in February and the coordinated global
money printing creates the multi-month rally. After the Brexit vote in late
June, the BOE promises stimulus as far as the eye can see creating the spurt
higher in stocks over the last month. The BOJ, PBOC and ECB also plan to keep
on printing easy money to make the wealthy wealthier. Weak China data kept the
stock market elevated last week since the PBOC will provide more easy money. The
central bankers are the market.

For the new trading week ahead, Monday, 8/22/16, with the
S&P 500 beginning at the important 2183-2184 pivot level, the bulls need to push above 2194 to create an upside acceleration that guarantees 2200+. Upside price action can be assessed at the 2188, 2190 and then 2194 levels.

For the bears, the SPX will need to fall under 2175 to accelerate the downside. The 2175-2178 confluence provides support for price. If it fails, 2169 is next then 2164 where the critical 200 EMA on the 60-minute chart is at 2164. This level determines who is the winner in the near-term; currently it is the bulls.A move through 2176-2184 is sideways action to begin
the week.

The CPCE put/call ratio remains at uber lows verifying market complacency and a near-term market top at hand. The top can occur any minute any day forward and since the CPCE already printed one other low a few days earlier, the stock market top is likely at hand right now, say early this week. The drop in the S&P 500 would be expected to be from 40 to 200 handles over the next month; a 40 to 100-handle drop is easily doable.

Fed Chair Yellen provides a speech at noon time Friday, 8/26/16, from Jackson Hole, Wyoming, USA, where all the world's who's-who in economics, business and central banks meet in a rural atmosphere.Markets are going to likely move significantly on Friday afternoon, either way up in a rally as Yellen flaps her dovish wings as usual, or, stocks may collapse if Yellen expresses hawkishness (that a rate hike will occur in September). She will likely hint that one hike will occur before the end of the year (December) to try an keep that thinking alive. This may reinforce the status quo.

Since Yellen will be spewing on Friday, there is a nice window open for bears early in the week and into mid-week. Typically, when there is a Fed meeting or event, stocks rally but the Fed events are usually a Tuesday or Wednesday rather than all the way at the end of the week on a Friday afternoon. Thus, the bears have to be given a slight advantage going into the new week of trading. The move down in stocks may be fast and sharp. Take the low put/call ratio serious.

Looking at the near-term picture the strongest price support/resistance is 2194, 2190, 2188, 2186, 2183-2184,
2174-2178, 2169, 2164, 2156-2157, 2152, 2135 and 2131. The bulls do not have a
care in the world unless the 200 EMA on the 60-minute at 2164 fails; if this
level fails, stocks will begin dropping in earnest. As long as price is
above 2156, the bulls are in control of the stock market for the hours and days
ahead. The test at 2164 which will likely occur this week will be an epic and important test and bounce or die decision for the stock market.

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